NFT: Do they have mainstream potential?
NFT or Non-fungible token is a term you must have heard a lot. It’s even having its moment of glory since Collins Dictionary announced it the word of the year, and that too ahead of contenders like ‘metaverse’ and ‘climate anxiety’
Now for those of you wondering What is this NFT?
In simple words, NFT or Non-fungible token means something which is unique and that you cannot replace with something identical. For example, you can replace Rs.100 with another Rs.100, it is fungible. But if you remember playing with Pokemon cards? If you have a rare Pokemon, it is non-fungible, you’d get something else in exchange right? That’s how NFT works!
Now, different NFTs offer different usage rights. Selling it and making a profit, is one thing but the biggest brag you can do at the moment is owning them. Some NFTs also act as exclusive tickets to online clubs. So, whenever you think of buying your NFT, you might want to actually see what right are you getting.
Below is a list of the biggest NFT marketplaces:
- OpenSea: The first NFT marketplace which was opened and is the largest today.
- Foundation: this one requires creators to be invited by fellow creators who are a part of it already.
- Rarible: Focuses on digital art and owns its RARI token that rewards its members.
- Nifty Getaway: A USD-based marketplace to buy and sell, it focuses on making NFT accessible for all. The mission is to have 1 billion people with NFTs.
- Superrare: Heavy on making and offering digital art of all sorts.
At this point in time, NFT can be considered a speculative investment. There’s no guarantee of whether it is here to stay or will pass with the wind. There is no guarantee of returns from the NFT purchase.
Potential NFTs can be seen with 3 key characteristics:
Image Credit: Jeremy Johnson - They are transparent: there is a blockchain which is a decentralized database, so records of the creation of token creation and transfers are publicly visible with blockchain explorers. It forms for the rarity and uniqueness which becomes easier for people to verify and authenticate.
- Gives ownership: this gives the owner complete control with the private key to the owner as it is held on their personal blockchain. It is the free will of the owner of what to do with the Nft, including selling, trading, and giving them away.
- Interoperability: NFTs created by creators as a token standard can be shared by multiple entities within their game world.
Image Credit: Taoliang Wang
Like anything new with technology and in the market, its worth is actually unpredictable. The ways in which artists, developers, and businesses utilise this lie under their innovative smart contracts that might take time to fruition.
The limits of what is possible in the world of NFTs are up for thought!